Orion Hotel Group forks out $46m for Sydney’s Earlwood Hotel as pubs run hot

The nation’s latest pub sale has introduced a new player to the sector, which is buzzing following the pandemic.

The Orion Hotel Group has bought the Earlwood Hotel in Sydney for $46m.

The national pub boom is showing no signs of slowing down with Sydney’s Earlwood Hotel selling for about $46m to a new investment group looking to set up in the hot sector.

Pubs are riding a tide of cheap capital and more professional funds managers are now competing to buy pubs against the big families that have dominated the sector.

The industry has been rerated with traditional pups now seen as real estate assets which can spin off multiple revenue streams, with lucrative food and beverage and alcohol earnings now combined with gaming and entertainment.

The newly formed Orion Hotel Group has swooped on the Earlwood Hotel, picking it up from well-known hotelier Kent Walker.

The sale by HTL’s Andrew Jolliffe, Dan Dragicevich and Sam Handy continues the big run of Sydney and NSW hotel trades this year, with the Pub Invest portfolio that spanned the city and regional areas just selling for a total of $127m.

The Earlwood Hotel sold for $46 million. Picture: Bill Hearne

The Orion Hotel Group, comprised of the Wiggins, Savas and Docker hotel families, has been set up to look for Sydney based opportunities just like the one presented by the eponymous Earlwood Hotel.

“Whilst clearly not foreign to the property class, it is rewarding to see new consortium’s access A-grade product such as this one-suburb-one-pub asset,” Mr Dragicevich said.

The sale of the Earlwood Hotel followed a short sale process, attracting a broad spectrum of interest, and culminating in multiple offers to purchase the high street hotel, which will now be overhauled.

“We’ve got a great deal planned for this aesthetically magnetic property, but everything we do will be designed to only strengthen the relationship the business has enjoyed with the local community for decades,” said purchaser, Michael Wiggins.

“It really is an extraordinary looking property, and has great scope for repositioning,” he added.

The national hotel landscape has been more active in the past 18 months than any other period in its storeyed history. Having sold the Crossroads Hotel last week for a record $160m sale for a pub in Australia, HTL Property believes there is more to come.

“Notwithstanding the contemporary volume of sales reported, the industry remains hugely fragmented; and it is our submission that those that act strategically and with purpose during this time, will be beneficiaries of sustainable portfolio augmentation for years to come,” Mr Jolliffe said.